Currently Playing:

Nintendo is coming off of a fantastic 2017 with the successful launch of the Nintendo Switch and numerous first-party games. Now with hindsight (their performance in 2017, albeit still incomplete since the fiscal year for Nintendo ends in March) and a bit of foresight (their incomplete lineup and Labo announcement) lets make some early predictions for Switch's 2018, ideally aligned with Nintendo's fiscal year: April 2018 - March 2019.

Here are some of the forces working for and against the Switch at moment as well as some of the uncertainty factors. BTW, I should mention I use the word core gamers a lot here, and by that I am specifying the early-20s to mid-30s male gamer (this is the group that makes up the largest portion of the system's base right now and is the main driver of its success).

Favorable Forces:

-Momentum: The Switch has clear momentum from 2017. There is a young, but nevertheless for the system's first year, decent backlog of evergreen games (Zelda, 3D Mario, Mario Kart, Splatoon) that can aide in sustaining momentum.

-Lots of potential evergreens left: Nintendo still has Pokemon, Animal Crossing, 2D Mario, 2D Zelda, Smash Bros. Not to mention the possibility of new franchises like Splatoon (which has quickly risen to become an A-class series in Nintendo's arsenal) and ARMS (which has done decently enough). There also quite a lot of support titles that sell consoles to smaller groups of people (which overtime counts) while also appealing to the existing installbase, this includes games like Fire Emblem, Paper Mario, Metroid Prime 4,etc.

-Appealing hardware: Yes the Switch hardware is weaker compared to its stationary counterparts, but it is the most powerful dedicated handheld hardware. This has allowed Nintendo to bring large-scale game experiences that were previously restricted to their stationary systems, while the portability seems to have convinced studios like GameFreak to bring titles like a core RPG Pokemon to the system.

-New life for old games: The Switch has been sufficiently powerful and portable enough to bring new life to certain older games. Old ports/remakes/remasters/emulations, in general, have been quite prevalent and popular this generation on the stationary systems (so there is clearly an audience), and the Switch, at least IMO, has the portability factor and the power that makes porting older content quite desirable. Not to mention that many of the ports are from the Wii U, a system that did not have a large appeal yet has some great games that could do quite well on Switch (provided the Switch's audience continues to expand). Although, relying too much on old ports has some downsides too, particularly when not combined with evergreen games; which I will get into in the unfavourable forces section.

Unfavourable Forces:

-The lineup for 2018 as we know now lacks evergreen titles that target large groups of mainstream core gamers particularly in comparison to its competition: The Switch's lineup for early-2018 (as we know it right now anyway), has lots in the way of ports/remakes (DKC:TF, Hyrule Warriors, YS, Dark Souls, TWEWY, Bayonetta 1+2) and support titles (Mario Tennis, Kirby, Yoshi, Fire Emblem). As mentioned above, the ports are good due to portability and particularly good for Wii U games that are finding new audiences, and the support titles can bring in smaller groups of people though their primary purpose is to provide something to existing buyers. The problem is that we do not know of much about the next ever-green titles. I am sure there will be some of these titles available on the system, but the timing and quantity of these titles is going to be important. This has particularly become evident to me, because Nintendo will be facing stiff competition from Sony this year. Sony right now is the primary platform for MonHun:Worlds (which I will discuss in its own point) which will experience high sales in the West but, more importantly, will be a major hardware mover in Japan; Nintendo does not have anything announced to counter it (this could be very problematic in Japan as I will discuss below). Two other titles that would divert attention from Switch amongst core games, as the system does not have something to compete for the wider core-gamer audience with them, are God of War and Detroit (releasing in April and sometime in Spring respectively). The lack of new mainstream evergreen titles, at least as we know right now, that appeal to this core group (last year they had Zelda to compete with Sony's exclusives) could cost them a good amount of their momentum.

-Price: I was one of the people that from the very beginning believed that price would be a challenge to the Switch, and it has thus far proved to be a far lesser challenge than expected. Nevertheless, I do believe that price continues to pose certain problems of its own when combined with other factors. For one thing, I believe the relatively high price of the system has limited it to two markets: 1) core games 2) families looking to purchase a single unit for the entire household. It is unlikely that at this price parents would buy multiple consoles for each child in the house. While I can still see the present library (both the backlog, and what we know is coming in 2018) appealing to families that have bought or are considering buying the system and core gamers that have already purchased the system, I feel the stiff competition presented by Sony and Nintendo's lack of response to it with new ever-green titles (that we know of right now, that are coming in time to compete with Sony's offerings) could turn-off potential core gamers that thinking of buying the system. The core gamer is key to the Switch's continued momentum at the present time because they make up the largest demographic on the system at the moment (expanding that demographic will be necessary particularly to get children, both boys and girls, as well as female gamers on board; but it is important to also keep the core onboard as well).

-The MonHun Effect in Japan: Monster Hunter has been proven to be a great installbase builder on PSP and 3DS in Japan (its lack of availability could also be said to be partially responsible for the Vita's stagnation in Japan), it is massively popular though the effects of a new game on consoles in presently largely unknown. Older original mainline Monster Hunter games did modestly on PS2, and the same could be said for the ports (Which were also available on handhelds). The problem is that the old original console games came before the system became so immensely popular in Japan, moreover looking at the effects of ports is not really fair since these games were available on the more popular portable formats. We know that Monster Hunter became popular on PSP because of portability (apparently people in Japan love playing this game locally with friends). The question now becomes whether or not Monster Hunter's popularity and Worlds's exclusivity as a mainline game to a home console will increase the adoption of stationary systems and their main methods of play (online play, emphasis on graphics over portability, etc) will result an uptake of stationary systems at the cost of portables? If it does, then this would be a huge blow to the Switch in Japan and overall viability. I don't think it is a stretch to expect that PS4 will overtake Switch in upcoming weekly Media Create sales for a few weeks to maybe even a few months, but if it ends up being a long-term trend and one that also takes sales away from the Switch then Nintendo could be in trouble. While what I have said is a stretch, they key is that MonHun is a very powerful franchise, Worlds has a great deal positive hype surronding with positive word of mouth spreading, and PS4 has a large backlog of Japanese-centric games. Japan is a key market that Nintendo needs to have a strong presence in, it is also an important market that reinforces the need to for portables; should Japan no longer desire portables that would have a major impact on the viability of Switch and any other future portables. I should mention that this point does contain a fair bit assumptions on things that are bold (like the dynamic of an entire market suddenly shifting from home console to portable) and hence uncertain. But I catagorized as a negative force, because even if it does not largely change the market trends in Japan, it will at least in the short-term (for a good portion of 2018), result in some of Switch's momentum being taken by PS4 (again it should not be surprising when the Media Create charts for the next few weeks to potentially few months has PS4 well above Switch; since Switch does not have new software able to counteract MonHun right now).

Uncertainties:

-Labo: This is a bit of a wild card right now. Reactions range from people calling an amazing concept that will aide in more parents buying a Switch for their household (hence expanding the installbase and bringing more kids; though as households and not as individual children) to others dismissing as too expensive and too niche to do so. It could expand the demographics and installbase on Switch, it could do nothing at all for the system, or, in the worst case, it could spook the core base away from the system which would negatively impact the system's momentum. Nintendo has said that they will share more on Labo in February, the folks that leaked the Labo event (Chrom from ResetEra in combination with Emily Roger) said that Nintendo is holding a Nintendo Direct like event in February; if this event overcovers Labo at the expense of new ever-green core games (which as I said above Nintendo needs more of for this year, including in the early parts to effectively compete for gamers with Sony's current releases) then I can see core gamers being spooked.

-Reaction to Paid Online: I think most forum gamers know that Nintendo will start charging for online play sometime in 2018. Families and core gamers that are not in tune with the latest gaming news (ie most people) are unlikely to know. These people's reaction could be quite negative if they are asked to pay for things that have been free up until now. Now you might say that they should have done their research before purchasing, but that is not the point here. Rather the point is that charging for online if your installbase does not know about it, might upset them, bring negative media coverage, and spread bad word of mouth which can damage the system. On the other hand, customers may be aware and may not really care about having to pay a modest fee, particularly if it means access to VC like service and improved online services. We are not really going to know what the reaction will be until the paid services start to roll out.

-Ever-Green 2018 Releases and Release Dates: I think it is clear that we do not know the full lineup, and my negative assessment of the lack of ever-green 2018 games (based on what we know now) could change at any moment. Key factors that we do not know include the ever-green games planned for release, the number of such games, and how they will be spread out. Ideally Nintendo should aim for one major ever-green title per-season (1 Spring 2018, 1 Summer 2018, 1 Winter 2018, 1 Winter-early Spring 2019) in order to have something to counter the competition and maintain momentum. Maintaining momentum now is critical for the system, because it is still relatively young and installbase is still relatively small, so we cannot have a drop-off in sales at this point. Nintendo needs to try to attain a audiences from different demographics, which involves taking risks like Labo, but that cannot come at the cost of reduced mainstream content for core gamers, because they are driving the adoption of the system right now and maintaining them (especially in face of stiff competition from Sony) is going to be critical to the ensuring the installbase continues to grow (particularly if some of the risks taken to get other demographics on board do not succeed).

Anyways, what do you guys think of these points? Do you have any other factors to add? And how do you think the system will fare in 2018?

Currently Playing:

Dude... Switch is what the Wii U should have been... I personally would like it to be more powerful even with a higher price tag but with games like the new Zelda and all the Wii U ports, there is no stopping this thing.

Currently Playing:

The question also is how much can Nintendo really produce? Japan is still out of Switches, Amazon US too. If this doesn't improve soon then it won't sell much more then 16-17M because it simply can't due to lack of stock.

I don't really like to predict, but the first two options in the poll seem very, very unlikely. We bought a Switch for my 12yo nephew this holidays with Zelda & Odyssey and he's completely besotted with the thing. He has a friend who speedruns Zelda. Teenagers & young adults are very driven by what is being played around them and I think there's a critical mass that Switch can reach to become even more successful. (At the moment I'm amazed when I meet adults who have literally no idea what the Switch is!)

That said, industry sentiment for the Switch has been sky-high and I think that there's a backlash waiting in the wings. Nintendo can be quite slow to exploit good will (for me the Wii was ultimately a bit of a disappointment because it never capitalised on the promise of Wii Sports) and I could see a lot of impatience if the release schedule becomes dominated by shovelware with too little AAA activity. Also, the Switch is currently helped by the fact that the VR goldrush is perceived as having stalled; if that gets rolling again then it sucks a lot of money out of the market that might otherwise go Nintendo’s way.

A year is a short time, though, and the adverse factors are unlikely to have much effect this year.

Selling over 20 million is credible, but this would depend on Labo. Switch could do 15 million without Labo succeeding, but it will take something special to put it over the top, and Labo has every appearance of a craze waiting to take off. If the mini-games exceed expectations then a large audience previously little interested in videogames could end up buying Switches as 'Labo machines'. Short-term, things look good in terms of sales.

The assumption is that Switch sales were supply-constrained in Year One and will be demand-constrained in Year Two, but that's what people said about Amiibo and Nintendo has never risked higher inventory costs on those. I could see the total for the year being up near the manufacturing capacity, in which case again we're probably closer to 20 than 15 million.

The question also is how much can Nintendo really produce? Japan is still out of Switches, Amazon US too. If this doesn't improve soon then it won't sell much more then 16-17M because it simply can't due to lack of stock.

This is the main question. That's why I don't talk about Pokemon, Animal Crossing or price-cut, because it all would be obsolete in the face of stock problems.